International climate politics post-Paris: playing a ‘strategic game’

A crucial provision of the Paris Agreement adopted last December is the requirement that all countries submit Intended Nationally Determined Contributions (INDCs). These reports publically outline planned steps to combat climate change and achieve the decided upon goal of collectively limiting the global temperature rise to under two degrees Celsius.

As of now, 162 countries have submitted INDCs but the greater challenge will be determining effective methods these countries can leverage to achieve the goals they described.

A discussion titled “What Next? Climate Mitigation After Paris” at the Wilson Center in Washington D.C. featured a group of experts focused on helping countries fulfill their contributions.

The challenge

Once INDCs are submitted, countries then have the obligation to implement the environmental changes they promised. Grzegorz Peszko, lead economist in the Climate Change Group of the World Bank, explained the difficulty in determining effective methods for implementation, especially the implementation of energy efficiency policies.

“We usually believe that energy efficiency is this low-hanging fruit but then when you actually send people to capture this fruit, then they can’t find the tree, it’s like everything is bushes,” Peszko illustrated. “For some reason, in so many cases, in many countries, energy efficiency projects … are so difficult to implement. Why? Because of all this hidden cost we don’t see in our models and in the front pages of our papers and advocacy narratives of NGOs, all the risks, all the transaction costs.”

A ‘strategic game’

Unlike previous climate agreements, such as the Kyoto Protocol, where international institutions handed down many of the climate action requirements to be followed, countries decide their own efforts in combatting climate change under the new Paris Agreement. This gives them greater involvement in the forming and implementation of their policies, a kind of “strategic game” that experts say can be beneficial.

In a game, there are incentives for goals to be reached and in climate politics the same applies with countries seeking prominence and avoiding criticism. Strategies such as carbon prices and taxes, regulations and infrastructure investments are financial means of changing environmental policy. Peszko argued that having countries interact with one another in these policies would be an effective method of implementing multiple countries’ INDCs at once.

“All countries are supposed to deliver their Intended Nationally Determined Contributions; this is the key,” Peszko said. “The process going forward will no longer be countries negotiating under the UN for emissions budgets allocated to each of them. The Paris process and the INDC revision process is a strategic game where countries will form or collapse coalitions, name and shame each other, bribe and threat each other, in order to create an incentive for everybody to create a stable coalition where everybody is interested in increasing cooperation for environmental change.”

Additionally, in games, rules must be followed and the same goes for this new framing of international environmental politics. Ensuring adherence stems from transparency in the promises and results of the INDCs, which is a portion of USAID’s work.

“We’re helping the countries do what they can do, what they said they’ll do in their NDCs, help them to fulfill their commitments,” Carrie Thompson, deputy assistant administrator for the Bureau of Economic Growth, Education and Environment for USAID, said. “We are certainly going to continue … measure accurately and set their emissions, so later they can accurately report on their progress in reducing those emissions as a part of their MRV work, their monitoring, reporting, verification work.”

Under this new framework of international climate politics, there will also be winners and losers. Promised shifts to cleaner energy sources under the Paris Agreement means that countries or companies with vested interests in fossil fuels will face losses.

As a result, countries or companies with vested interests in fossil fuels will be facing losses.

“The economics are shifting, these pesky cars seem to get farther and farther on less and less gasoline so it is very hard to find an expanding market for Saudi Arabia or for Chevron,” Bill Tyndall, CEO of the Center for Clean Air Policy, said. “We are going to have play honestly with environmental externalities.”

As some markets contract, opportunities elsewhere are expanding and Peszko says losing players should be able to shift their prospects.

“The challenge of the future is to get these countries who are dependent on coal, dependent on oil, dependent on gas both in terms of their exports and power infrastructure, get them engaged in the international game to facilitate their diversification process and deepen their diversification … because at the moment all they see is the pain of transition,” Peszko said.

Success in Mexico

Mexico was the first developing country to submit an INDC, which committed to the reduction of greenhouse gas emissions by 22 percent by 2030 and addressed both mitigation and adaptation strategies. Additionally, Mexico has served as a bridge between other developing countries, especially those in Latin America to developed countries in establishing INDCs. This role has increased Mexico’s stature in the global community and has even won Mexico international recognition.

Beatriz Bugeda, director general of climate change policy in Mexico, spoke about the multiple players and factors that went into Mexico’s successes in enacting environmental measures as exemplified by the 2012 Mexico Climate Change Law.

“Even before Cancun, President Calderón was very active on climate change and after Cancun, we realized that we needed to do something very fast and that something was to start negotiating legislation,” Bugeda said. “I can tell you before Climate Change Act and after Climate Change Act, things are improved.”

With these achievements, Bugeda spoke about how Mexico is now cooperating with its regional neighbors in implementing INDCs.

“Being so active on climate change has been good for us in the international arena,” Bugeda said. “We are taking advantage of those opportunities and we’re working with everybody. We’re working with the U.S. Once we delivered our INDC, the U.S. government called our government immediately and we integrated this taskforce with the U.S. and then Canada went and knocked on the door and wanted to participate. Now we have three heads of state who are together working on climate change.”